LA Added 3,420 Consulting Firms and Few Consulting Jobs

Los Angeles County added 3,420 consulting businesses between 2019 and 2024. It added far fewer consultants.

Employment in the county's management, scientific and technical consulting sector grew 11.3 percent over that period, less than half the national rate of 23.5 percent. The number of establishments in the same sector grew 32.7 percent. The gap between those two figures is the story of what the advisory business in Los Angeles has become.

Firms up, headcount flat

The data comes from the Bureau of Labor Statistics Quarterly Census of Employment and Wages, a near-complete count of jobs covered by unemployment insurance rather than a survey sample. The industry is NAICS 5416, which the Census Bureau classifies as management, scientific and technical consulting services. It spans strategy advice, environmental consulting, IT advisory work and scientific consulting, so treat it as the advisory economy broadly rather than as management consulting alone.

All figures are private-ownership, first-quarter counts.

Q1	LA County jobs	LA establishments	Jobs per establishment	LA avg weekly wage
2019	51,281	10,443	4.91	$1,848
2021	50,547	11,971	4.22	$1,978
2023	56,818	13,587	4.18	$2,178
2024	57,065	13,863	4.12	$2,244

Source: BLS Quarterly Census of Employment and Wages, NAICS 5416, private ownership, Q1 of each year. Indexed to Q1 2019 = 100. Method: each series divided by its own Q1 2019 value.

The average Los Angeles consulting establishment employed 4.91 people in early 2019 and 4.12 people in early 2024, a decline of 16 percent. The county's advisory sector is not consolidating into larger firms. It is dispersing into smaller ones.

Worth stating plainly, because it is the easiest thing to get wrong about this data: the same dispersal is happening nationally, and slightly faster. Average establishment size across the United States fell from 5.48 to 4.51 employees over the same five years, a 17.7 percent decline. Los Angeles is not an outlier in direction. What distinguishes it is the combination of that dispersal with unusually weak job growth and below-average pay.

The pay gap

The average Los Angeles consulting job paid $2,244 a week in early 2024. The national average for the same industry was $2,442. Los Angeles, the second-largest metropolitan economy in the country, pays its consultants roughly 8 percent below the national average for their industry.

That is not what you would expect from a high-cost coastal metro, and it is the opposite of the pattern in the other major advisory centres. It is consistent with a sector weighted toward independent operators and small boutiques rather than toward the large firms that pay partner-track salaries. A market of four-person shops has a different wage distribution than a market of four-hundred-person offices, and the county-level average reflects it.

California as a whole tells a similar story. Statewide consulting employment grew 10.7 percent between 2019 and 2024, against the national 23.5 percent, despite California being the largest consulting employer of any state at 226,494 jobs.

What a four-person firm cannot do

The operational consequence of a market made of small firms is specific: there is no bench.

A large firm produces client deliverables with staff whose job is partly to produce them. Analysts build the deck, associates check the numbers, and the partner edits the argument. A four-person consultancy has no analyst layer. The person who wins the engagement is the person who does the analysis and also the person who formats the slides at eleven at night.

That is why the market for AI deck builder for management consulting software has grown alongside the fragmentation rather than in spite of it. The tools are not primarily competing with in-house design teams, because small firms do not have those. They are competing with the principal's own evening.

An ex-McKinsey consultant who ran five AI presentation tools against real client decks reported the pattern most independent consultants describe: the tools handle layout and first-draft structure competently, and the judgment about what belongs on the slide stays with the human.

What to check before adopting one

The category now includes Gamma, Prezi AI, SlidesAI, Alai, NextDocs, 2Slides, STORYD and Matik, and they differ more in operational fit than in output quality.

Requirement	Why a small firm cares	Common failure
Editable PowerPoint export	The client will edit the file after handoff	PDF-only, or export that breaks formatting on reopen
Charts bound to source data	Numbers come from models that get revised	Decorative charts requiring manual redrawing
Client template matching	Each engagement has its own brand rules	Generic themes needing full reformatting
Confidentiality terms	Client material is under NDA	Vague or absent policy on training from uploads

The confidentiality question deserves more attention than it usually gets from solo practitioners. A four-person firm uploading a client's financial model to a tool with unclear training terms has made a decision about that client's data, whether or not it was a deliberate one.

The caveat

One county over five years is a narrow window, and 2024 is a single data point rather than a trend. Establishment counts also capture registered businesses, which include consultants who incorporated while holding other work, so some of the 32.7 percent growth in firms represents side practices rather than full-time businesses. That does not change the employment figure, which counts jobs on payroll.

What the data supports is narrow and reasonably firm: Los Angeles is adding consulting businesses much faster than it is adding consulting jobs, the typical firm is getting smaller, and pay sits below the national average for the industry.

Common questions

Is the LA consulting sector shrinking? No. Both jobs and firms grew. Jobs grew slowly, at 11.3 percent against 23.5 percent nationally, while firms grew quickly.

Why does average firm size matter? It determines whether deliverable production has dedicated staff. Smaller firms mean the same person does the analysis and the formatting, which changes what tooling is worth buying.

Does this mean large consultancies are leaving Los Angeles? The data cannot show that. It shows the average establishment is smaller, which is consistent with many small firms being added rather than with large ones departing.

Are these figures only management consulting? No. NAICS 5416 also covers environmental, scientific and IT advisory services, so read it as the advisory economy rather than strategy consulting alone.

Cover photograph: Downtown Los Angeles skyline, public domain, via Wikimedia Commons.